January 10, 2006

Argentina's 2005/06 soybeans 94 percent planted

Argentine farmers had planted almost 94 percent of the 2005-06 soybean crop by Saturday, the Buenos Aires Cereals Exchange reported Monday.

That puts the pace of planting up from 90 percent a week ago but down 1.7 percentage point from a year ago at this time, when area was substantially smaller.

"The dry climate is delaying the planting of second-crop (soybeans) in the central agricultural region," the Exchange said. "The scarce or almost total lack of soil moisture in some areas of center-north and western parts of Buenos Aires, centre-south Entre Rios, northern parts of La Pampa and southern Cordoba is impeding the planting of pending area. In contrast, in northern provinces, after fresh rain during the first days of the year, the planting pace is picking up and area is 70 percent sown."

The drought is seriously affecting the country's key soybean production zone.

"Even so, the ample temperature range is compensating in part for the lack of moisture and helping to avoid greater damage (to the crop)," the Exchange said. "The lack of water is also causing problems in southern Cordoba, where soybeans that were recently planted over older wheat fields will be lost unless it rains soon."

The Exchange said "there is still time for more moisture." However, it cautioned that second-crop soybeans need water urgently so they can develop normally through the vegetative stages.

The Exchange expects farmers to plant a record 15.62 million hectares of soy this season, up from 14.67 million hectares a year earlier. As of Monday they had sown 14.086 million hectares.

The USDA has forecast Argentina's 2005/06 soybean output at a record 40.5 million tonnes, compared with the previous record of 39 million tonnes a year ago.

Farmers are planting and producing more soy because it is cheaper to grow than corn and it can be sold for more money in commodities markets.